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The Wealth of Religions, by Rachel M. McCleary and Robert J. Barro

15 November 2019

Peter Day is impressed by economists taking religion into account

ECONOMISTS — or at least the books that they publish — seem to be paying increasing attention to the contexts and circumstances in which the practice of economics operates. This busy, idea-crammed book echoes Adam Smith’s monumental Wealth of Nations in its title; its worldliness may be rather disquieting to readers who think of religion mainly in terms of faith.

The authors are both economics academics at Harvard University. Preserving their detachment, they remain coy about their religious affiliations until almost the end of the book. But their approach is summed up in the title of the first chapter: “Religion: It’s a market.”

The starting-point for Rachel M. McCleary and Robert J. Barro is — naturally — the influential German sociologist Max Weber’s ideas in The Protestant Ethic and the Spirit of Capitalism. He described how human traits such as honesty, thrift, and the work ethic were fostered by the Reformation and then played a significant part in the development of capitalism and the Industrial Revolution.

But Weber also thought that, even in the mid-19th century, modern capitalism had become “emancipated” from its old religious supports. Not so, say McCleary and Barro. Using modern figures, they conclude that religious beliefs — particularly in heaven and hell — continue to be important drivers of economic growth.

The tension between the prosperity produced by the diligent following of religious ethics and the resulting triumph of capitalism deeply concerned John Wesley; of course, it remains a tendency of successful religions.

The book extends Weber’s examination of Protestantism in some striking ways by applying it to other religions, including Hinduism, Buddhism, and Islam, and sects, including new religious terrorist movements: “religious clubs” is the term that the authors use.

The book’s general thesis that a high level of belief (particularly in heaven and hell) is accompanied by notable economic growth is confounded by the Islamic experience, where, in recent centuries, growth has been slower compared with other places. The Islamic emphasis on political and social stability seems to have produced economic stagnation.

And there is an intriguing aside on Ramadan here. It tends to lead to slower economic growth. But, as the daylight hours when Ramadan is conducted vary seasonally, winter Ramadans are less disruptive of the economy than summer ones. Compare two predominantly Islamic countries, Turkey and Bangladesh: in years with a summer Ramadan, Turkey’s growth slows compared with that of Bangladesh (closer to the Equator); in winter, the effects are reversed.

One slightly unexpected chapter examines (with striking historical data and a thorough explication of the process) the making of saints. In the past 40 years, there has been an unprecedented increase in beatification, the first step towards canonisation, which eventually follows. It is “the Catholic Church’s competitive response to Protestantism”, the authors say. It reignites religious fervour in traditionally Roman Catholic regions.

Although they are working economists, McCleary and Barro take an interdisciplinary approach, combining economics, sociology, anthropology, history, geography, theology, and philosophy; their observations are backed by large inputs of data.

“We are excited by how much we have learnt about how religion matters,” they say. “We hope that readers will share in this excitement.” The Wealth of Religions suggests that there are many more insights to be gained by incorporating religion into the forces of economics.

Peter Day is a former presenter of Global Business on the BBC World Service.

The Wealth of Religions: The political economy of believing and belonging
Rachel M. McCleary and Robert J. Barro
Princeton University Press £2
Church Times Bookshop £22.50

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